CMS Postpones Bundled Payment Programs to January

Ken Terry

May 22, 2017

The Centers for Medicare and Medicaid Services (CMS) has postponed the start date of its new mandatory bundled payment models and amendments to the existing Comprehensive Care for Joint Replacement (CJR) program from October 1 to January 1, 2018. In March, CMS delayed the start dates of the new 5-year demonstration programs and the CJR amendments from July 1 to October 1.

The latest postponement, included in the final rule on the bundling programs, was not unexpected. CMS in March sought comment on a further delay in the start date to January 1. In addition, CMS' "interim final rule with comment" (IFC) on these programs hinted that the agency might modify or even eliminate the bundled payment programs in the future.

Commenters on the IFC said that more time was needed to help them prepare for the new programs, a CMS spokesman told Medscape Medical News. The commenting parties also wanted to ensure that CMS had time to engage in further notice and comment rulemaking, should that be warranted. This suggests that further rulemaking may be in the offing.

US Department of Health and Human Services Secretary Tom Price, MD, has made it clear that he disapproves of CMS' mandatory bundled payment programs. Last September, when he was still a congressman from Georgia, he sent CMS a letter saying that the demonstrations were "experimenting with Americans' health" and that CMS had exceeded its statutory authority.

Dr Price's position on this issue, coupled with the postponement of the programs' start date, has ignited speculation that the programs may be modified to allow hospitals to opt out of them or that they might be eliminated altogether.

The CJR demonstration, which started April 1, 2016, requires about 800 hospitals to take bundled payments for hip and knee replacement surgery. These payments cover hospital and physician services and 90 days of postdischarge care.

The new programs include the Advancing Care Coordination through Episode Payment Models (EPMs) and the Cardiac Rehabilitation Incentive Payment Model, an adjunct to the EPMs. The EPMs consist of bundled payments for episodes of care involving acute myocardial infarction (AMI), coronary artery bypass grafts (CABG), and surgical hip and femur fracture treatment.

In each of these episodes of care, hospitals are paid retrospectively for the total costs of care provided to patients during their hospitalization and for 90 days after discharge. Initially, the hospitals will receive bonuses if their costs fall below historical benchmarks and meet quality standards. For episodes ending January 1, 2019, or later, the hospitals will have to take downside risk and reimburse CMS if their costs exceed benchmarks.

Under the Cardiac Rehabilitation Incentive Payment Model, hospitals can receive bonuses if they coordinate cardiac rehabilitation and support beneficiary adherence to postacute-care plans. The demonstration is intended to support the episode-based bundled payments for AMI and CABG episodes of care. It will be implemented in 90 geographic areas, of which half have also been selected for the AMI and CABG models.

The amendments to the CJR will allow some physicians who participate in this demonstration to qualify for advanced alternative payment model (APM) status under CMS' Quality Payment Program. APM eligibility would guarantee these doctors 5% bonuses on their Medicare payments for 5 years and exempt them from the requirements of the Merit-Based Incentive Payment System.

To meet APM criteria, which include financial risk, physicians would have to partner with a hospital that participates in Track 1 of the CJR model, according to CMS. In addition, the first performance year for measuring adherence to these requirements would be 2019, so eligible physicians would not start receiving bonuses until 2021.

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